Does New York City spend enough on public school education? The state Supreme Court Appellate Division effectively answered “yes” in a recent decision overturning last year’s ruling by Justice Leland DeGrasse, who struck down the state’s school funding system on the grounds it unconstitutionally discriminated against city students.

While the latest legal dispute over school funding[1] heads for New York’s highest court, this much is undeniably true: By any relevant measure, significantly more city and state tax money is being plowed into the Board of Education than ever before. Consider the following chart:

Real spending per pupil*

*assumes $380M cut in 2003 adopted budget

New York’s inflation-adjusted per-pupil school spending, as illustrated above, has risen dramatically over the past seven years—including yet another significant hike under the newly enacted budget for fiscal 2003. Even before this most recent increase, the city’s public schools spent more per pupil than 45 states and 94 of the nation’s 100 largest school districts, according to the latest available federal statistics.[2]

What about all those headlines earlier this year concerning Mayor Michael Bloomberg’s proposed “cuts” in the school budget? Turns out they were actually referring to reductions in the budgetary baseline—spending’s upward flight path if left on automatic pilot.

In the wake of the city’s generous settlement with the United Federation of Teachers, the city budget adopted in June had provided for an increase of $685 million in state and city support for the Board’s operating expenses—raising the total to $12.4 billion, up 6 percent from 2002.

Under Mayor Bloomberg’s July 8 budget-cutting directive to all city agencies, newly appointed schools Chancellor Joel Klein will now have to reduce spending by up to $380 million. But even after that cut is fully implemented, operating expenditures (excluding capital expenses) during the 2002-03 school year will rise by 2.3 percent, about the same as the regional cost of living index. The total operating budget will hit $11,128 per pupil, another all-time high in nominal terms, based on preliminary enrollment projections. Adjusting for inflation, that’s 11 percent above the Dinkins-era high-water mark—and a whopping 57 percent above the level of 1983.

The steep upward trend in the Board of Ed’s baseline spending since 1995 has been driven by two factors:

• The school system added more than 13,000 staff members in the last five years (even while enrollment growth was flat), and
• Teacher salaries and benefit costs are rising at nearly three times the rate of inflation.

Despite this year’s increase, the city’s public school officials say even more money was needed to maintain programs at 2001 levels. From a traditional, baseline-budgeting standpoint, they’re right.[3]  But that assumesevery existing Board of Education program must be treated as sacrosanct, and that absolutely no change can possibly be made in the way services are delivered. Such assumptions are indefensible in the best of times and simply cannot withstand a budgetary environment as hostile as the one Mayor Bloomberg faces.

Originally Published: FISCALWATCH MEMO

Notes

1. Campaign for Fiscal Equity et. Al. V. State of New York.
2. For further details, see the data posted by the National Center for Education Statistics at http://nces.ed.gov/pubsearch/
3. See, for example, the recent Independent Budget Office “report card” on 2001-02 school spending.